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As WP's senior editor, I edit review and preview articles, attempt to keep up with the frantic pace of Rainier's news posts, and keep our reviewers on deadline, which is akin to herding cats. When I have a moment to myself and don't have my nose in a book, I like to play action/RPG, adventure and platforming games...

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French Government Refutes Willingness To Help Ubisoft

by Judy on Jan. 12, 2005 @ 8:27 a.m. PST

The French government said on Tuesday it was concerned about French video games group Ubisoft but would not intervene directly in the fate of the company, seen as a potential takeover target.

Speculation that Europe's third-largest games publisher could slip out of French control has been rife since U.S. rival Electronic Arts (ERTS.PA: Quote, Profile, Research) took a stake of nearly 20 percent in Ubisoft last month, driving up its shares.

"We are watching with attention and concern," Industry Minister Patrick Devedjian told reporters at a New Year's press reception.

Asked if the government would intervene directly in the matter, he said, "Certainly not."

A French newspaper reported last week the government was working actively behind the scenes to encourage France's largest media group Vivendi Universal (EAUG.PA: Quote, Profile, Research) to act as a so-called white knight for Ubisoft in the event of a hostile bid.

Vivendi denied it was in takeover talks with Ubisoft.

A source close to the matter told Reuters last week that Vivendi was "looking at Ubisoft" and the government was worried about seeing French games technology come under foreign control.

But one person close to the matter said last week he did not believe Vivendi was interested in actually buying Ubisoft.

Vivendi is emerging from restructuring as a mainly telecom-focused company after shedding most of the entertainment acquisition debts which nearly drove it bankrupt in 2002. It has been unable to sell its own loss-making games unit, however.

Ubisoft shares have retreated slightly from their highs above 29 euros a share, seen when Electronic Arts first emerged as a major shareholder, and were down a further 1.6 percent to 27.89 euros at mid-session on Tuesday.

Ubisoft said earlier this month it considered EA's investment as hostile until it got more information from EA. It has hired Calyon, the investment bank of Credit Agricole, to help it reject a possible bid from EA, a source close to the company said. Calyon was not available for comment.

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